Cotton farmers across the United States will split an estimated $300 million in shared assistance payments made available through the U.S. Department of Agriculture Farm Service Agency (USDA FSA).
Agriculture Secretary Tom Vilsack announced the new Cotton Ginning Cost-Share program Monday.
“The Cotton Ginning Cost-Share program will offer meaningful, timely and targeted assistance to cotton growers to help with their anticipated ginning costs and to facilitate marketing,” Vilsack said. “The program will provide, on average, approximately 60 percent more assistance per farm and per producer than the 2014 program that provided cotton transition assistance.”
The program is designed to “expand and maintain the domestic marketing of cotton.”
Through it, cotton farmers will be eligible for a one-time payment based on their 2015 cotton acres reported to FSA, multiplied by 40 percent of the average ginning cost for each production region.
Payments to Texas farmers will be $36.97 per acre, according to Plains Cotton Growers (PCG).
“We greatly appreciate U.S. Secretary of Agriculture Tom Vilsack and the USDA for listening to the concerns of cotton producers and coming up with a viable short-term solution that will help us face some of our challenges,” PCG President Johnie Reed, a cotton farmer from Kress, said.
PCG reports the program will have the same eligibility requirements as the 2014 Cotton Transition Assistance Program. They include a $40,000 per producer payment limit, requirement to be actively engaged in farming, conservation compliance and a $900,000 adjusted gross income limit.
“We had hoped for some flexibility in the payment limit, but we are grateful for the assistance, because our producers certainly need it,” Reed said. “We recognize that this is a program for the near term, and we remain committed to working with Congress and others in trying to establish cottonseed as an ‘other oilseed’ under Title I of the 2014 Farm Bill, which would provide long-term stability for our industry.”
Signup for the program will be held June 20-Aug. 5 at FSA offices. Payments are expected to go out in July.
Farm groups, including American Farm Bureau Federation (AFBF) and Texas Farm Bureau, encouraged USDA to consider the gin cost-sharing program and the inclusion of cottonseed as an oilseed in the farm bill to help cotton farmers hurt by high input prices, low commodity prices and the absence of an effective farm bill safety net.
“Farm Bureau commends Secretary Vilsack’s decision to provide a temporary Agriculture Department program to help U.S. cotton farmers defray processing costs, giving them hope as they face some of the most difficult market conditions in more than a decade.
“We are especially appreciative that Secretary Vilsack took the time to work with us, the National Cotton Council and others to arrive at this special, one-time arrangement without requiring legislative action,” AFBF President Zippy Duvall said. “This is a clear example of what we can accomplish when we work together. Our cotton farmers and the rural businesses they partner with will be better off because USDA took action to address a serious market downturn in their industry.”